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New cranes, bigger investment coming to Port of Wilmington [video]

News this week of a five year extension by Fruit Maroc that will bring Maroccan fruit into the Port of Wilmington was certainly welcome news. First Look this week looks at the port and how they view their long term economic survival.

For 90 years, the Port of Wilmington has been a source of blue collar jobs for hundreds of Delawareans. Now, there’s some concern for whether that can go on as strongly as in the past.

From humble beginnings in 1923, the Port of Wilmington now crows about its status as North America’s top importer of fresh fruits, bananas, juice concentrate. The port also lays claim to the continent’s largest ‘dock-side refrigerated complex’.

“I can’t begin to tell you the amount of cargo that comes in here of different types,” says Port of Wilmington Executive Director Gene Bailey. “Live cattle, last year we did 50,000 head exported through the facility, rocket boosters come through the facility, steel comes through the facility, we have wind blades, for wind turbines, it goes up and down the gamut.”

All that cargo in and out of the port adds up to big dollars in economic impact for the state. Director of Delaware’s Economic Development Office Alan Levin calls the port a “huge economic driver.” He says the port helps put food on the table for 4,900 families in the state.

“We do over 350 million dollars’ worth of personal income each year,” says Bailey. “On a state-wide basis, through an economic impact study, $35-38 million dollars’ worth of general taxes are generated, so it’s huge.”

Those revenues are generated in part by the workers who help unload the massive container ships that regularly call on the Port of Wilmington with that wide variety of cargo.

Paul Cutler is vice president of the Longshoreman’s union at the port. “When it gets busy, we probably have over 250 people working in a day, five days a week, sometimes Saturdays and Sundays.” He says as the colder weather arrives, activity at the port heats up. “It’s definitely getting busier, we have 30 more part time people coming on board in January, so the port is definitely picking up business.”

But to keep the container ships coming to Wilmington instead of other ports in the region is a constant challenges. And a big part of that challenge is keeping the port’s infrastructure current and in working order. “This is a capital intensive business,” says Levin. “Quite frankly these toys behind you, these cranes, at $12-15 million dollars a pop, they’re expensive, and the state has got a lot of economic costs that they have to deal with.”

The high costs of keeping the publicly-owned port competitive led the state to consider a financial partnership with the private company Kinder Morgan, a massive energy firm which owns 80,000 miles of pipeline. The Kinder Morgan investment would have fell apart earlier this year after objections from the longshoreman’s union.

ILA union president Julius Cephas didn’t like what he was told by Kinder Morgan officials during their discussions. “This company told me and Paul that they were going to downsize. As soon as they came in, 100 part time jobs were gone, they let us know that, a lot of people didn’t know that, but right now, I’m pleased the way things are going now, but it would have been disastrous for our community.”

Port leaders insist the state was not going to sell to Kinder Morgan, but rather, partner with them. “I think it should be noted that the port was never for sale,” says Bailey. “We were looking for a partner to go forward with. There is an ongoing need for capital investment.”

“We were seeking out someone who had deeper pockets than the state of Delaware,” says Levin. “[A partner] who could invest into the Port of Wilmington, continue to not only grow the jobs that we have, but to grow the lines that we have, as well. That didn’t work out. We understand that, that was yesterday, today we’re moving forward.”

As part of that ‘moving forward’ state lawmakers passed legislation this year giving the General Assembly a say in any sale, lease or privatization of the port in the future.

“Now, we got 60 some people that got to go through and look at it,” says Cephas. “You got more eyes on it, I feel much more comfortable knowing that the elected officials will look at it instead of a few appointed by the board from the Governor.”

So for now, making a deal with a deep-pocketed partner is off the table. “I wouldn’t say that we’re looking for someone to partner with,” says Bailey. “I would say that we will evaluate everything that’s presented to us as it comes along.

Without a deal, the state will now be on its own to continue the successful operation at the port. “Remember, this is owned by the taxpayers,” says Levin. “It’s not owned by the port, it’s not owned by anybody. The taxpayers pay the bills here, so when we look at things, we say, ‘what is in the best interst of the taxpayers of Delaware?’ Right now, it’s maintaining this port, and growing it.”

The effort to grow the port will get a $10 million boost thanks to a recently announced U.S. Department of Transportation TIGER grant to pay for upgrades. “This is a great addition,” says Levin. “The $10 million dollars, while we actively pursued it in previous years, I don’t think it could have come at a better time, even though the state has put 31 million dollars into the facility over the next five years, that’s a huge commitment

The fruit will continue to flow into the Port of Wilmington. In late summer, the Port of Wilmington announced details of a tentative agreement that should keep Dole ships delivering fruit to the port for the next 15 years. Dole had considered moving from Wilmington to the Port of Paulsboro across the Delaware River in New Jersey.

Bailey says port leaders lobbied hard to keep Dole in Wilmington. “It came about through extensive discussions and negotiations. We went to Dole, we understood Dole was entertaining discussions with other places. We put a package on the table that they seemed to like.”

In mid-October, a fruit company from Morrocco signed a deal five-year deal to deliver fruit through the Port of Wilmington. Fresh Fruit Maroc will make Wilmington its North American distribution hub for clementines and other citrus fruit.

“The long-term commitment from the Moroccan growers, affirms the Port of Wilmington’s leadership and specialization in the critical handling of fresh fruit and produce from around the world for the benefit of the citizens of the Eastern United States and Canada,” said Levin.

There are challenges ahead for the Port of Wilmington, especially as the Delaware River deepening project comes past the port. While the Delaware River will be deepened, the Port of Wilmington technically is not on the Delaware River, but rather the Christina River. That means the Christina will have to be deepened if the Port of Wilmington hopes to compete for larger ships steaming up the river.

Watch this story and all of our Delaware stories on First. It airs on WHYY-TV, Friday at 5:30 and 11pm, Saturday at 5pm, Sunday at 2:30.